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Chatham's mayors: Let's negotiate, not litigate

Posted: November 6, 2012 - 1:03am

Editor’s note: This column was submitted by the top elected officials of Chatham County’s eight municipalities.

Historically in Chatham County, elected representatives from the County and the eight municipalities — Bloomingdale, Garden City, Pooler, Port Wentworth, Savannah, Thunderbolt, Tybee Island and Vernonburg — have come together on matters of great importance and reached fair compromises that benefited the greatest number of citizens.

Earlier this summer, we embarked on such a process. At issue was creation of a new formula to distribute an estimated $600 million in Local Option Sales Tax revenue over the next decade.

We, as the mayors of the eight municipalities of Chatham County, are deeply disappointed that Chatham County Government refused to engage in meaningful negotiations from the very beginning of that process. As a result, we had no comprehensive discussion about what was fair and best for the citizens of Chatham County.

Instead, the County’s strategy was to avoid meaningful negotiations and bring this matter to court, a goal realized when the County filed a petition last week to have the matter heard by a judge in a judicial forum. Avoiding negotiation runs contrary to the process prescribed by State law, and is not in the spirit of cooperation that has been a hallmark of Chatham County governance through the decades.

It is also an expensive legal process, and a serious gamble of public dollars. Instead of each side putting forward a LOST proposal, then negotiating toward the middle, a judge has one remedy: He or she can either choose the position of the Cities, or choose the position of the County.

The 1 percent sales tax is one of the major revenue sources for our governments, funding core services such as police, fire, and streets maintenance, thereby reducing our reliance on property taxes. Because of LOST, the owner of a median-priced home in Savannah currently receives a reduction in his or her City tax bill of more than $600 per year.

Chatham is an urban county. Over two-thirds of our citizens live in the cities, and most services are provided by the cities. The cities also fund operations, such as the Civic Center, Tybee Beach, which benefit all county’s residents.

More than 80 percent of all taxable sales take place in the cities, and it takes incredible resources to support this level of business activity. Accordingly, the County and cities have agreed in the past that most of the LOST proceeds be distributed to the cities that provide these services.

This year, however, the County proposed a radical restructuring of the LOST distribution, which would increase the County’s share of the proceeds from 17.8 percent to 55.31 percent per year. If implemented, this would shift $225 million from the municipal governments to the County government. Because the County has refused to participate in meaningful negotiations, and decided to prematurely end mediation, it is unclear why they have proposed such an extreme shift.

If we were to accept the County’s proposal, most of the cities would be required to substantially increase their property tax rates. City residents, however, would not receive a corresponding benefit from the County government.

For example, under the County’s proposal the owner of a median-valued home located in the City of Savannah would see an $85 drop in his or her County tax bill — the same decrease that all median homeowners in Chatham would experience. That same Savannah homeowner, however, would see a corresponding $299 increase in his or her City tax bill. The effect on taxpayers in some of the other municipalities would be even more severe.

The major beneficiaries would be the major industries in the unincorporated area, some of which would receive tax reductions of hundreds of thousands of dollars per year. None of these industries has asked for such a tax break.

We request that all of the County Commissioners participate in a resumption of this process. We, and they, represent the same citizens.

We do not believe that litigation between our local governments is in anyone’s best interest.

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